1% TDS Calculator for Crypto Transactions
Calculate how much 1% TDS will be deducted from your crypto transactions in India based on the current regulations. This tool helps you understand the actual tax impact of your trades.
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Note: This tool shows only the 1% TDS calculation. Remember that you may still owe additional tax on capital gains (up to 30% + 4% cess) based on your overall profits.
On July 1, 2022, India quietly changed how millions of crypto users handle their trades. A 1% Tax Deducted at Source (TDS) started applying to every sale, trade, or spend of cryptocurrency - no exceptions. It didn’t matter if you held Bitcoin for a day or five years. If you moved it, the government took 1% right at the point of transfer. That’s not a capital gains tax. That’s not a profit tax. That’s a deduction taken before you even see your money. And it’s still in force today.
What exactly is the 1% TDS on crypto?
The 1% TDS is part of Section 194S of the Income Tax Act, introduced in the 2022 Union Budget. It means that whenever you transfer a virtual digital asset - like Bitcoin, Ethereum, or any token - the platform or person handling the transaction must deduct 1% of the total value as tax and pay it to the government. This applies to sales, trades, and even spending crypto to buy goods or services. But it does not apply if you move crypto between your own wallets. That’s just a balance shift, not a transfer under the law.
The deduction happens automatically on Indian exchanges like CoinDCX, WazirX, and ZebPay. You won’t get a bill. You won’t get a notice. The money just disappears from your payout. For example, if you sell ₹50,000 worth of Ethereum, ₹500 gets taken out before you receive ₹49,500. That’s it. No paperwork from you. No form to fill. The exchange handles it.
Who pays it and when does it kick in?
Not everyone is affected the same way. There are two thresholds, and they split users into two groups.
If you’re a regular person - not running a business, not audited by tax authorities - you only hit the TDS trigger when your total crypto transactions in a financial year (April 1 to March 31) cross ₹50,000. So if you bought ₹30,000 in crypto in October and sold ₹25,000 in January, you’re still under the limit. No TDS.
But if you’re a business, a high-income earner, or someone who’s already under tax audit, the threshold drops to ₹10,000. That means even a small trade of ₹12,000 triggers the 1% deduction. This double-tier system was meant to target big players, but it’s confused millions of small investors who assumed the ₹50,000 limit applied to every transaction.
And here’s the twist: if you trade crypto for crypto - say, swap Bitcoin for Solana - both sides pay 1% TDS. That means the buyer pays 1% of the value they’re receiving, and the seller pays 1% of what they’re giving. So a ₹1,00,000 trade ends up with ₹2,000 taken out total. The platform you use handles both sides, but the cost is baked into every swap.
What about crypto-to-crypto trades?
This is where things get messy. Unlike the U.S. or EU, where only fiat conversions are taxed, India taxes every single crypto-to-crypto swap. That includes decentralized exchanges (DEXs) and peer-to-peer (P2P) trades.
On centralized exchanges, TDS is automatic. But on P2P platforms like LocalBitcoins or Telegram groups, the responsibility falls on the buyer. If you buy ₹20,000 worth of Dogecoin from someone on P2P, you must deduct ₹200 as TDS, get their PAN number, file Form 26QE, and send them a TDS certificate. Most people don’t do this. And the government knows it.
The Income Tax Department has made it clear: if you’re trading outside regulated platforms, you’re on your own. No automation. No safety net. And if you get caught, you could face penalties for non-compliance - even if you didn’t make a profit.
How does it compare to other countries?
India’s approach is unique. Most countries tax crypto only when you cash out to rupees or dollars. Germany lets you hold crypto tax-free after one year. The U.S. taxes gains at 15-20%, depending on income and holding period. Singapore doesn’t tax crypto gains at all.
India doesn’t care how long you held it. Doesn’t matter if you lost money. If you moved it, you paid 1%. And that’s not all. In July 2025, the government added another layer: an 18% GST on exchange platform fees. So if you trade ₹2,50,000 worth of crypto and pay a ₹1,000 fee, you pay ₹2,500 in TDS plus ₹180 in GST. That’s ₹2,680 gone before you even touch your balance.
Only Japan has a similar model - but their transaction tax is just 0.4%, not 1%. India’s rate is among the highest in the world for basic transfers.
What’s the real impact on traders?
For casual buyers who hold long-term, the 1% TDS is barely noticeable. But for active traders? It’s a killer.
Imagine a day trader making 100 trades a month, each worth ₹10,000. That’s ₹10 lakh in monthly volume. TDS comes to ₹10,000 per month. That’s ₹1.2 lakh per year - gone - just for trading. That’s not a tax on profit. That’s a tax on activity. It erodes capital fast. A 2024 WazirX study found traders who did over 50 transactions monthly lost an average of 8-12% of their trading capital annually just to TDS.
Many have adapted by splitting trades below ₹50,000. Others moved to international platforms like Binance or Kraken - but now face legal gray zones. The RBI doesn’t ban these platforms, but they’re not regulated. If something goes wrong, you have no recourse.
Why is the government doing this?
The official reason is transparency. Before 2022, crypto transactions were nearly invisible to tax authorities. No one knew who owned what. The 1% TDS forces platforms to report every trade. The result? In FY 2023-24, the government collected ₹1,852 crore in crypto TDS - 27% more than expected.
According to the CBDT, TDS compliance on registered exchanges is now 98%. That’s a win for enforcement. But it’s also a win for control. The system creates a digital paper trail for every crypto movement. That’s valuable for future regulation - or crackdowns.
Some experts, like Dr. Reetika Khera from IIT Delhi, say it’s the only way to bring crypto out of the shadows. Others, like former economic advisor Dr. Vijay Kelkar, call it a “policy mistake” that pushed India’s global crypto market share from 1.5% to 0.7% in two years.
What are the biggest problems users face?
Confusion. That’s the biggest issue.
According to a ClearTax survey of 2,150 Indian crypto users, 63% of salaried people stopped trading after TDS kicked in because they didn’t understand the thresholds. Many thought ₹50,000 was per transaction. Others didn’t know crypto-to-crypto swaps counted. Reddit threads in 2024 showed 78% of respondents were unsure how to calculate their annual limit.
Then there’s the delay. TDS deducted in June doesn’t show up in Form 26AS - your official tax statement - until September or October. That means when you file your returns, you’re guessing how much was taken. Some users reported delays of 90 days. CoinSwitch Kuber had a glitch in 2023 that applied double TDS to over 15,000 trades. Refunds took months.
And if you’re using P2P? You need the seller’s PAN. Many don’t have one. Or they give fake numbers. Filing Form 26QE manually takes 45-60 minutes per month. Most just don’t bother.
What should you do now?
If you trade on Indian exchanges like CoinDCX or ZebPay: you’re covered. The system works automatically. Just check your Form 26AS after July every year to confirm the TDS was credited. If it’s missing, contact the exchange.
If you use P2P or foreign platforms: you’re responsible. Track every transaction. Save timestamps, wallet addresses, and PAN details. File Form 26QE monthly. Keep records for six years. If you’re unsure, hire a tax professional. Costs range from ₹1,500 to ₹5,000 a year.
If you’re a long-term holder: you’re fine. As long as you don’t sell or trade, TDS doesn’t touch you. But if you plan to cash out later, remember: you still owe 30% tax on profits - plus 4% cess - on top of the 1% already taken. That’s a total tax burden of up to 34% on gains.
What’s coming next?
The government is testing a new system. By Q1 2026, NPCI - the same body that runs UPI - plans to launch a pilot that auto-reports crypto transactions to the tax department. If it works, you might not even need to file anything. Your wallet activity will flow directly to the Income Tax Department.
There’s also talk of raising the ₹50,000 threshold to ₹1,00,000. The Finance Ministry received 142 stakeholder requests to do so. But nothing’s confirmed yet.
The proposed Digital Asset Bill 2025 could replace TDS entirely with a centralized registry. But until then, the 1% rule stands. And it’s here to stay.
Final thoughts
The 1% TDS isn’t about fairness. It’s about visibility. The government didn’t want to ban crypto. It wanted to monitor it. And it succeeded. Every trade now leaves a digital fingerprint.
But for the average user, it’s become a maze of thresholds, forms, and delays. The system works perfectly for big exchanges. For everyone else? It’s a burden disguised as compliance.
If you’re still trading in India, you’re not just investing in crypto. You’re investing in a system that takes 1% of your moves - no matter the outcome. Know the rules. Track your numbers. And don’t assume the platform has your back.
Is the 1% TDS on crypto a tax on profits?
No. The 1% TDS is deducted on the total transaction value, regardless of whether you made a profit or loss. Even if you sell crypto at a loss, 1% is still taken. The actual tax on profits is separate - it’s 30% plus 4% cess under Section 115BBH.
Does TDS apply to transfers between my own wallets?
No. Transferring crypto from one wallet you own to another - like from your exchange wallet to your hardware wallet - is not considered a transfer under Section 194S. No TDS is applied. Only sales, trades, or spending crypto to buy something triggers the deduction.
What happens if I trade crypto on a foreign exchange like Binance?
Indian exchanges deduct TDS automatically. Foreign exchanges do not. But if you’re an Indian resident, you’re still legally required to self-report and deduct TDS on your own for crypto-to-crypto or crypto-to-fiat trades. Failure to do so can lead to penalties under Section 201. Most users avoid this by not trading on foreign platforms - or by keeping minimal balances.
How do I check if TDS has been deducted correctly?
Log in to the Income Tax e-Filing portal and view Form 26AS. TDS deducted by exchanges will appear under Section 194S. It usually takes 7-10 business days to reflect after the transaction. If it’s missing after 30 days, contact your exchange’s support team with your transaction ID.
Can I claim a refund if I paid TDS but had a net loss?
No. The 1% TDS is not refundable, even if you had overall losses in crypto during the year. Losses cannot be offset against crypto gains or other income under current rules. The TDS is a prepayment - not a final tax. You still owe 30% on any gains, but you can’t reduce your TDS amount based on losses.
Are NFTs and tokens also subject to 1% TDS?
Yes. The Income Tax Department defines Virtual Digital Assets (VDAs) broadly - it includes cryptocurrencies, NFTs, tokens, and any digital asset with value. Any transfer of these assets, whether sold, traded, or spent, triggers the 1% TDS if the threshold is crossed.
Do I need to file ITR if I only made crypto transactions under ₹50,000?
If your total income (including crypto gains) is below the taxable limit (₹3 lakh for individuals under 60), you’re not required to file ITR. But if you had any crypto transaction above ₹50,000 in the year, you must file ITR - even if you made no profit - because TDS was deducted. The government tracks this via Form 26AS.
Shane Budge
December 5, 2025 AT 11:351% on every trade? That’s insane.
sonia sifflet
December 7, 2025 AT 08:25People still don’t get it - TDS isn’t a tax on profit, it’s a tracking tool. The government doesn’t care if you lost money. They care that you moved crypto. And now they have the data. You think this is about revenue? No. It’s about control.
Barb Pooley
December 7, 2025 AT 14:19So now I’m supposed to file Form 26QE for every P2P trade like it’s my full-time job? And if the seller gives me a fake PAN? Do I go to jail? This isn’t taxation, it’s harassment dressed up as compliance.
Roseline Stephen
December 7, 2025 AT 20:39I used to trade daily. Now I just HODL. The 1% adds up faster than you think - especially when you’re doing small arbitrage plays. I lost 11% of my capital last year just to TDS. No profit, no gains, just money evaporating every time I clicked ‘sell’.
Tara Marshall
December 8, 2025 AT 00:43Check your Form 26AS after July. If TDS is missing, contact your exchange immediately. Many users miss refunds because they assume it’s automatic. It’s not always.
Kenneth Ljungström
December 9, 2025 AT 15:46India’s system is wild but kinda genius? Like, yeah it’s harsh, but now the tax department actually knows who’s doing what. No more anonymous crypto black holes. I’d rather pay 1% and have transparency than risk a future audit nightmare.
Stanley Wong
December 9, 2025 AT 18:56Compare this to the US where you can trade crypto for crypto without triggering a taxable event - and then you only pay capital gains when you cash out. Here, even if you swap BTC for ETH and immediately lose half your value, you still paid 1% on the full trade. That’s not a tax, that’s a penalty for movement. And now with the 18% GST on fees? You’re paying tax on the tax. It’s a cascade of extraction.
Billye Nipper
December 11, 2025 AT 03:42If you’re a casual holder, you’re fine. But if you’re active? You need to treat this like accounting. Track every trade. Save wallet addresses. Use a spreadsheet. Don’t wait until April to panic. I started logging everything after I got hit with double TDS in 2023 - took six months to fix. Don’t be like me.
Nelson Issangya
December 11, 2025 AT 13:34Stop complaining. At least India is trying to bring crypto into the light. In Nigeria, we have zero rules - and people are getting scammed daily. Better to have a flawed system than no system at all.
Uzoma Jenfrancis
December 11, 2025 AT 19:26They’re not trying to tax crypto - they’re trying to kill it. Every rule is designed to make it too expensive, too confusing, too risky. The moment you start trading, you’re drowning in paperwork. The government doesn’t want you to succeed - they want you to quit.
Madison Agado
December 11, 2025 AT 23:16It’s not about whether the tax is fair. It’s about whether the state has the right to monitor every digital movement. This isn’t fiscal policy - it’s surveillance capitalism with rupees. Every trade becomes a data point. And once they have that, what’s next? Algorithmic freezing of wallets? Auto-freezing of accounts based on transaction patterns? We’re not just paying tax. We’re surrendering autonomy.
Ben VanDyk
December 12, 2025 AT 19:41They say the threshold is ₹50k per year for regular users. But how many people actually track their total crypto volume across exchanges? I didn’t know I hit it until my Form 26AS showed ₹520 in TDS. I’d done five trades under ₹10k each. No one tells you this stuff until it’s too late.
Regina Jestrow
December 14, 2025 AT 11:07Wait - so if I send ETH to a friend as a gift, is that a TDS event? What if I buy NFTs from someone on OpenSea? Do I need their PAN? Are they supposed to deduct TDS from me? This system is so poorly designed it’s almost comical. It only works if everyone is a robot with a tax accountant.
Brooke Schmalbach
December 15, 2025 AT 18:31They call this transparency? More like a digital leash. The moment you trade, you’re tagged. The moment you use a DEX, you’re a fugitive. The moment you try to move your crypto off-exchange, you’re a criminal. This isn’t regulation - it’s a digital police state with a 1% fee.
Richard T
December 16, 2025 AT 09:30For those using Binance or Kraken - you’re not safe. The Indian tax department has access to blockchain analytics firms. They can trace your wallet addresses. If you’re an Indian resident, you’re still liable. Ignorance isn’t a defense. You think they don’t know you’re using a VPN? They do. They just don’t bother chasing small fish… yet.
nicholas forbes
December 17, 2025 AT 09:34I’ve been trading since 2017. I’ve seen every tax regime. India’s is the most aggressive. But here’s the thing - it’s working. Crypto fraud is down. Tax evasion is down. The system is brutal, but it’s clean. If you want anonymity, go to Monero. If you want to trade INR pairs, play by the rules.
Sandra Lee Beagan
December 18, 2025 AT 19:17As someone who works with crypto in Canada - this is the most comprehensive tax framework I’ve seen for VDAs. The thresholds are low, yes. The compliance burden is high, yes. But the clarity? Unmatched. Other countries are still arguing whether NFTs are securities. India just taxed them. Done. No ambiguity. That’s power.
michael cuevas
December 20, 2025 AT 06:08Oh look, another ‘what you need to know’ guide that doesn’t tell you the real truth - you’re not supposed to be trading crypto in India. The government just doesn’t want to admit they banned it outright. So they made it so expensive and complicated that you quit on your own. Brilliant.
Nina Meretoile
December 20, 2025 AT 16:33It’s not about the money. It’s about the message. Every time you trade, you’re reminded: you’re being watched. You’re not free. The 1% isn’t the cost - the fear is. And that’s what they really want.
jonathan dunlow
December 21, 2025 AT 03:03If you’re an active trader, stop using Indian exchanges. Move to international platforms and self-report. It’s a pain, but it’s better than losing 12% of your capital annually to TDS. I switched to Kraken in 2023. Now I file Form 26QE manually every month. Took me three weeks to get the system right. But now? I’m in control. And I keep 100% of my profits - minus the 30% on gains, which is fair.
miriam gionfriddo
December 22, 2025 AT 13:27Also, did you know the government is testing NPCI integration for auto-reporting? Like UPI but for crypto? So your wallet will auto-send your trade history to the IT dept. No forms. No filing. Just… done. Welcome to the future. You don’t get to opt out. You don’t get to say no. You just get to pay.
Elizabeth Miranda
December 23, 2025 AT 15:08I’m American, but I’ve watched this unfold. What India did here is terrifyingly efficient. They didn’t ban crypto. They didn’t outlaw it. They made it so bureaucratic that it becomes a chore to participate. And in doing so, they turned every trader into a reluctant tax agent. That’s not policy. That’s psychological warfare.
Chris Jenny
December 24, 2025 AT 11:41They think they’re smart? Wait till the next crash. When everyone’s trying to cash out and the system crashes from 10 million TDS deductions in 48 hours? Then watch how fast the government scrambles to fix it. This isn’t a system - it’s a time bomb with a 1% fee.
Kenneth Ljungström
December 24, 2025 AT 18:16Just to clarify - if you’re using a P2P platform and the seller doesn’t give you a PAN, you can use their Aadhaar number instead. I’ve done it. Just write ‘Aadhaar provided’ in Form 26QE and attach a screenshot. The IT dept accepts it. Don’t panic. There’s a workaround - you just have to dig for it.